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Fed U-turn, investors escape, catch-22 for RFMarkets actively discounted under the monetary policy turn in the United States. In this light, the current decline and weakness of the dollar are quite understandable. On the part of officials, comments about a possible rate cut sound more and more actively. In particular, recently the St. Louis Fed President Jim Bullard, said that lowering the rate may be necessary to counter the risks of trade war. Federal Reserve Vice Chairman Richard Clarida said that the Central Bank is ready to lower rates. Well, and finally, yesterday Fed Chairman Jerome Powell noted that the Central Bank is ready to "act in a suitable manner to support the expansion" of the economy. Recall that the markets are confident that the rate will be reduced at least twice in 2019, while there is a non-zero probability that the rate will be reduced 4 (!) Times during the year. Despite the formal reason for the optimism growth in the stock market, investors are escaping from the stock market. One of the reasons for the panic was the information from Reuters that the US Government might launch an antitrust investigation against Amazon, Apple, Facebook and Google. Following the news, Facebook and Alphabet Inc shares fell by more than six percent, and Amazon shares fell by four and a half percent. In this light, the behavior of Stanley Druckenmiller, one of the legendary Wall Street investors, seems quite logical. He sold all the shares from his portfolio (the proportion shares, in the portfolio structure, was over 90%). Recall, the Reserve Bank of Australia reduced the interest rate to the lowest value in the history of 1.25%. Our recommendation for working with the Australian dollar against the background of such information is to look for points for its sales. Yesterday was remembered by rather sad statistics on the UK. Retail sales literally collapsed by 3% at the end of May (the lowest value in the entire history of observations), and the index of business activity in the construction sector surely went below 50, indicating a decrease in economic activity. Wednesday in terms of macroeconomic statistics will be more active. We are waiting for data on retail sales in the Eurozone, data on employment in the US from ADP (we recall, on Friday will be published official statistics on the US labor market, including data on the NFP), as well as data from a number of US business activity indices. Bloomberg analysts recently published the results of a study which showed the unattainability of most plans of the Russian authorities in terms of economic growth and improvement of welfare in the country. The main conclusion is: Putin’s plans to double the GDP aren't meant to be. The Russian Federation in fact fell for the so-called "catch 22". In this case, it can be formulated as follows: to ensure economic growth above 3%, it is necessary to accomplish a number of smaller tasks, performance is possible only at a GDP growth rate above 3%. And the current growth rate equals 2%. That is, small goals will not be completed (the basic condition is not completed), which means that the main goal, growth above 3%, will not be achieved either. In this regard, we recall the feasibility of selling the Russian ruble on any attempts to grow. Since the growth rate is below the world average - it is not even standing still, this is the lag and loss of competitive positions. Our positions today: we are continuing to look for points for buying of the euro and the pound against the US dollar, sales of oil and the Russian ruble, as well as buying of gold and the Japanese yen. In addition, we will sell the Australian dollar against the US dollar.
Short
by Trade24Fx
We are preparing for European elections & referendum in the UKToday, we shall consider important topics, near future and opportunities. Elections to the European Parliament will be held in Europe this week. (Elections will be held in 28 countries from May 23 to 26, 2019, 751 members will be elected. Those elected people will represent more than 512 million Europeans, which makes these elections the largest transnational elections in history.) The event is quite dangerous for the euro buyers. The fact is that the victory of the euro “skeptics” might cause difficulties in adopting the EU budget. And the Italian populists, with their plans to violate the EU budget deficit requirements, do not contribute to the faith growth in the bright future of the euro. Another potential victim of election results could be the pound. It is all about the attention that has been focused on internal political squabbles and negotiations in the UK. There are two sides in Brexit process, they are the UK and the EU. However, the EU could not make a compromise and then there will be no agreement at all. And there will be a “rigid” Brexit. In this light, we continue to remind you of the risks incising working in pound pairs, especially when it comes to buying pounds. Confirming our thesis about how is everything uncertain over the pound and Brexit, we cannot but note that British Prime Minister Theresa May will invite members of the House of Commons of the British Parliament to hold a new Brexit referendum. May wants to propose to British to decide, on their own, whether to approve her version of the deal or not, following the example of the majority of parliamentarians who have repeatedly voted against, or to abandon the idea of “divorce” altogether. Pound after the appearance of this news soared by a hundred points, but then returned to the original. (in chronological order of publication) Inflation statistics from the UK, data on retail sales in Canada, as well as the text of the minutes of the last FOMC Fed meeting publication, are the most interesting events. We note that recently the Canadian dollar has strengthened in the foreign exchange market. This is due to news that the US will soon cancel duties on steel and aluminum from Canada and Mexico. That is, the attitude of the markets towards the Canadian dollar is positive. So, the positive statistics on retail sales will definitely give an upward momentum to the currency of Canada. Recall that this week we recommend looking for points for buying of the Canadian dollar. Our trading positions for today are as follows: we will look for points for buying of the euro against the US dollar, sales of oil and the Russian ruble, as well as buying of gold and the Japanese yen.
by Trade24Fx
Fair price for Bitcoin, the pound - worst week, artificial oilJPMorgan Chase & Co analysts in connection with the rapid growth of the cryptocurrency market in recent times, and Bitcoin in particular, have thought about the question “what is its fair price?”, so-called intrinsic value. Determining the fundamental cost of cryptocurrency is a very difficult and highly ambiguous question, but considering Bitcoin as a commodity asset, you can simply calculate the amount of the cost of "its production" (electricity, the computing power of computers, equipment depreciation, etc.). So, according to their calculations, the current price sharply exceeded the “cost price” of Bitcoin. This last happened in 2017. We know the result. Recall, any increase in cryptocurrency should be used for their sales – that is our position. The pound remains under pressure. Actually, previous week was the worst for the pound since 2017. There was little chance that the Government will accept the deal. And the chair Theresa May is sitting on wobbling quite a lot. According to the polls, the most likely candidate is Boris Johnson. Property prices in the UK are continuing to decline, reflecting the concerns of investors and consumers about the results of Brexit. Given that there is no domestic political unity in the UK, the chances for a positive outcome in the near future are not visible. This means that the pound will continue to be under pressure. Like real estate prices in the country. Oil price is growing. The reasons are the same - tensions in the Middle East and the potential threat of war with Iran. Despite the fact that the current desire of the market is to buy oil, we recommend looking for points for sales on the intraday basis as well as medium-term. Why? - some artificiality of the current market conditions. OPEC + has limited the offer, but this process is unnatural and at any time in the market may appear 1.2 million b / d above. The current position of Russia, that proposes not to rush to the issue of extending OPEC + after June is playing in its favor. At the same time forecasts for oil demand have become increasingly gloomy lately. Important macroeconomic statistics will not be published today, so the events will probably continue to evolve in line with current trends. Our trading positions for today are as follows: we will look for points for buying the euro against the US dollar. Points for selling oil and the Russian ruble and points for buying gold and the Japanese yen.
Short
by Trade24Fx
Prospects for peace in trade wars, Japan’s GDP, OPEC+ and BrexitThe previous week has been having a hard time fundamentally duo to Sino-U.S. trade war. China does not intend to a resumption of negotiation still Washington is continuous to speak from a position of strength and power. Therefore the “happy end” was very close but suddenly became subtle. Investors have been hoped for restarting the dialogue and rising in seeking compromise, but on Friday it became clear that it is not something should be counted on. According to the Chinese state media, the country sees no reason for the resumption of the negotiation process. Thus, all hope for a meeting of the heads of China and the United States in the framework of the G-20 summit at the end of June. That is, another month and a half should not count on stress-reduction. From the perspective of such news, we have become even more confident about our position to buy safe-haven assets (Japanese yen and gold). Accordingly, we are planning to look for points for buying safe-haven assets (Japanese yen and gold) on the intraday basis. As for the yen, today's data on Japan's GDP is additional and a strong argument in favor of buying the Japanese currency. GDP growth in the first quarter significantly exceeded analysts' expectations. Everything is still bad with the pound, that ended the week with the strongest decline in the last few years. Markets are selling duo to another Parliament vote failure in Britain. Prime Minister Theresa May is under pressure by not only her opponents but also members of her own party. We are talking about her resignation from the post of a leader according to the results of the fourth vote in Parliament. And the results for the current scenario are predictable - a vote “against” the May plan. Despite the extremely attractive points for pound buying, we continue to wait for a fundamental reason for their start. The results of the previous week appeared pretty successful for oil. But we are still full of pessimism. On the one hand, the trade war is a very negative signal for oil demand, and therefore for a possible increase in asset prices. In addition, we are skeptical about the future of OPEC +. That is, from the supply side in the near future there is a very serious threat. Total, this week we will continue to look for opportunities to sell the asset. But do not tend to get carried away and each intraday position has to be limited with fairly rigid stops. The fact is that the OPEC + meeting held this weekend somehow reassured investors who were nervous. OPEC + participants expressed readiness to comply with the agreement until the end of 2019. And yes, the number of active rigs in the United States has fallen to a minimum over the last 13 months. There are enough bullish signals for oil, especially considering very serious tensions and problem situations in Iran, Venezuela and Libya. As for our preferences for this week in general and Monday in particular, they are as follows: we will look for points for buying the euro against the US dollar, selling oil and the Russian ruble, as well as buying gold and the Japanese yen. Considering how uneasy the financial markets are, we will limit our positions with fairly shortstops, especially since some of the deals are definitely at odds with the current mood on the markets.
Short
by Trade24Fx
Weak data from the USA, oil in danger and pound under pressureYesterday’s data on US retail sales could be described as weak only. Sales dropped 0.2% in April (with growth forecast at 0.2%) therefore the dollar has suffered sales. We recommended looking for points for selling the dollar yesterday because the afore-mentioned scenario was considered as fundamental one. Our position is unchanged – we short the dollar. First of all against the euro and the Japanese yen. Perhaps the Canadian dollar could be added. Inflation data came out. The reason to hope for less aggressive rhetoric from the Central Bank of Canada has been given by inflation data on Canada. Another data that came out yesterday was the statistics from China. The figures also frankly did not please: industrial production, retail sales and investment growth rates - all indicators appeared much worse than expected. That only assured investors that the world economy will slow down further, and the trade war is - a real evil. Meanwhile, the pound continues to be under pressure. The basic reason is the same - Brexit. The government is not able to get on well with Labor. This means that the vote on the updated Brexit plan, scheduled in the House of Commons for the first week of June, may fail once again. Our position is to refrain from buying the pound. By “goodbye” we mean the appearance of clarity in Brexit situation. Given that the potential of pound growth is measured in hundreds of points, it is better to receive less than 100-150 pounds of profit but to enter consciously and surely. Meanwhile, tectonic shifts are possible in the oil market in the near future. The point is that OPEC + is coming to an end. And the decision to extend it is still far from being made. This weekend will be held negotiations of OPEC +. According to rumors, Russia is ready to support the increase in oil production. Given that Saudi Arabia, in general, has similar desires, there is a reason to think that OPEC + will cease to exist, or at least, the size of production cuts will be revised to a significant decrease. For oil, this means one thing - a reason for a medium-term downtrend formation. So we recommend starting selling oil now, while it costs so much. Our trading plan for today: we will look for points for buying the euro and the Canadian dollar against the US dollar, sale oil, and the Russian ruble, buy gold and the Japanese yen.
by Trade24Fx
Trump’s expectation, Bitcoin rally and crisis forecastsTrade war discussion is been #1 on the financial markets. However, the tension has been falling down so far. Tramp has decided to change the tactics. He said that takes a positive attitude towards meeting with Xi Jingping (will take place next month at the G-20 summit). Therefore, the markets were confused. And have no idea what to do next. The apocalyptic predictions were made by analytics in case of extraordinary scenario. On Morgan Stanley’s strategist Mike Wilson point of view, the escalation of trade dispute boosted the likelihood of economic slowdown. John Normand (JPMorgan Chase & Co) believes that “the risk is that some important indicators that are influenced by the exchange of tariffs, approach crisis levels. These are an industrial activity, business indices, capital costs and corporate profits.” Recall that Wall Street analysts have been signaling of a recession, but so far they have not received actual confirmation. Cryptocurrency market has been enveloped in inspiration and optimism. The price for Bitcoin has raised above 8000$, giving a fresh boost to the cryptocurrency market. However, there were no reasons for that. Just because a huge amount of those was said like the flight of investors in cryptocurrency after the trade war’s intensification, a general decrease in investor anxiety about cryptocurrency or market resilience to negative news - after a series of scandals around the cryptocurrency market, including hacking and hacker attacks, cryptocurrency prices did not come down. On the other hand, those reasons could not boost a cryptocurrency market’s sharp rise. Another reason might be “loss of profit syndrome ”. Investors still remember l how Bitcoin rose from 800 to 20,000 over the course of a year, literally and are afraid of being late with entering the position. That is, the rush demand for a cryptocurrency this week is the result of a set of fundamental factors as the effect of the crowd multiplied by greed and fear of being late for the departing train. We do not practice trading on emotions and behavioral deviations. Therefore, we are extremely skeptical about the current rally. meanwhile, the pound continues to be under pressure. The reasons are the lack of progress in Brexit. Yesterday, wage growth in the UK was a problem for the pound, which turned out to be much worse than expected. Our positions on the pound are on pause so far - we are waiting for the end of its sales, to buy cheaper. Following Tuesday, our trading preferences have changed: we will look for points for buying the euro against the dollar, sale oil and the Russian ruble, as well as buying of gold and the Japanese yen, but so far we will wait a little with buying the Australian and Canadian dollars.
Short
by Trade24Fx
Positive from China, money from Japan, the best deal of the weekThe markets somehow calmed down after the shock caused by Trump's tweets. The reason is that the information that China is not going to withdraw the negotiators. This week a Chinese delegation will arrive in Washington for the next round of talks. This is a confirmation of our assumption that Trump's tweets should be responded calmly since this is nothing more than a form of pressure on the negotiators. Another example of similar negotiations we observed was between the USA, Canada and Mexico. The result is well-known - a successful completion with a benefit for the United States, of course. So something similar is happening now. However, the Fear Index (VIX) does not think to go down. Accordingly, our recommendations for finding points for gold and Japanese yen buying as well as oil sales remain relevant. Strategists at JPMorgan Chase & Co, meanwhile, are wondering where the $ 400 billion of Japanese investors will get, which they will receive after redeeming Japan’s government bonds. The amount is more than serious and any of its directional movements, especially one-time, will greatly influence the dynamics of prices in any market. It is quite possible to observe a carry trade wave, which will contribute to the weakening of the Japanese yen. So if a strong movement on sales of the yen suddenly begins in the foreign exchange market, you should not stand in its way. Recall, at one time Soros needed about $ 10-15 billion to crush a pound by 15-20%. Accordingly, $ 400 billion is very serious. Markets will focus on working out the current fundamental background and price trends on Wednesday. Recall that this week’s most promising position is buying of the Australian dollar that has been chosen by us. Since the Bank of Australia did not substitute the national currency and showed restraint in the comments (there were no hints at the prospects for reducing the rate), the current points continue to be extremely attractive for mid-term trade with targets of 300-400 points and stops no more than 100. Our vision of the most promising positions for trading today are unchanged: buying of the Australian dollar and the euro against the dollar, sales of oil and the Russian ruble, as well as buying of gold and the Japanese yen.
by Trade24Fx
FOMC results, what to expect from the Bank of England & ADPThe announcement of the Federal Open Market Committee (FOMC) Fed meeting results was the main event. As we expected parameters of monetary policy were left unchanged. As for the comments, the Fed has been extremely positive about what is happening in the US economy recently. At the same time, the Central Bank noted weak inflation indicators, which were perceived by the markets as a “pigeon” position. Recall that the Fed simply does not have any reason to raise the rate with weak inflation. And that means that the pause in the rate increase will be delayed or the rate might be lowered, to intensify the inflation processes in the country. Nevertheless, the lack of any mention of the fall on the part of the Fed possibility perceived the markets as a signal for buying the dollar, which, by the end of the day, somehow compensated previous losses. Our position is still unchanged - we continue to look for the dollar selling points today. About the dollar news. Publication of statistics on US employment from ADP was another important news. The data came out surprisingly good: + 275K jobs (forecast was + 180K). Recall that this Friday we are waiting for official statistics on the US labor market. If the figures for the NFP are somewhere in this area, it can greatly help the dollar, which is experiencing serious problems this week. But in more details, we will talk about this tomorrow. The meeting of the Bank of England is on focus today. To begin with, as in the case of the Fed, we do not expect any changes in the Great Britain monetary policy parameters. In addition to the factors that put pressure on both the Fed and the Bank of England (the threat of a slowdown in global economic growth and a possible transition to the recession stage), the Central Bank of England has one more even greater problem - Brexit. While there is no clarity on this issue, the risks of the chaotic exit of Britain from the EU are great, and this promises a very serious level of uncertainty and potential damage to the economy. To loosen the boat in such conditions, the Central Bank simply has no right. So today we do not expect surprises from the Bank of England. As for buying the pound, after the strong growth in the last couple of days, the results of the Bank of England meeting may well be perceived as a reason for the local correction. So today we are more likely to sell pounds than to buy it. According to the Ministry of Energy report, oil production in the United States increased by 100 thousand to 12.3 million barrels per day, which is a new absolute record. At the same time, oil reserves in the US unexpectedly rose sharply (by +9.93 million, with a forecast +1.47 million). These are pretty strong bearish signals. So today we will look for points for oil sales. Our positions for today are as follows: we will continue to look for points for selling the dollar against the euro, as well as the Australian and Canadian dollars. In addition, we will buy gold, as well as sell oil and the Russian ruble on the intraday basis.
by Trade24Fx
What is behind the dollar growth? Forex Market Trading PlanYesterday's dollar growth took many by surprise on the foreign exchange market. The dollar index has reached its maximum in the last couple of years. Let's try to understand the reasons for this growth, as well as reflect on the near future of the US currency and trading tactics. There were several suggested explanations for the growth of the dollar by leading analysts and traders. One of them - the rise in prices on the oil market will trigger an increase in inflationary pressure in the United States. In turn, the unwinding of the inflation spiral will force the Fed to reconsider its current position in relation to rates. The process of raising them will be removed from the pause and the Central Bank will continue to increase the rate. Another reason for the dollar growth, voiced by analysts, was the expectation of good statistics on US GDP for the first quarter and the current strengthening of the US currency - an attempt to discount for good data. As we see, both explanations are outside the plane of facts and, in fact, are trading on expectations and rumors. That is, the markets routinely “buy” rumors, so than to sell the facts. In this regard, we are extremely skeptical about the prospects for further growth of the dollar in the foreign exchange market. At least, till growth begins to be based on facts. For example, will excellent data on US GDP will actually come out? Or the Fed will make some real statements and actual actions? So far this week, data on sales of new homes in the United States (reached the maximum for the last year and a half marks: + 4.5% with a forecast of -2.7%). Note that the dollar growth has also contributed to the weakness of its main competitors. The euro was declining due to problems with Italy (rating agencies may downgrade Italy), the pound was traditionally “upset” because of the lack of progress in Brexit (according to rumors, Theresa May is serious about voting on the Brexit bill again, on the next week, considering that nothing radical it was not included in it, the chances for another failure are very high), the Swiss franc and gold were falling because of the general growth of investors' “appetite” to risk, and their exit from safe-haven assets.Thus, our position on the dollar remains unchanged - we will continue to look for points for its sales in the foreign exchange market. And we will do this in double volumes with obligatory and rather rigid stops. However, the size of potential profits justifies such a risk. In relation to the news, the following day is interesting because of the meeting results of the Bank of Canada. The Central Bank is likely to leave the parameters of monetary policy unchanged. But the recent rise in oil prices has definitely played into the hands of the Canadian dollar. So, we recommend watching USDCAD- current quotes look exceptionally attractive for its sales. Our trading plan for today is USDCAD sale from 1.3450 with stops above 1.3520 and profits around 1.33. Despite the fact that we are going against the current “will” of the market, today we will continue to look for points for selling the dollar against the euro, the pound and especially the Canadian dollar. We will wait for a little with buying of gold, but we will look for points for buying oil on the intraday basis.
Short
by Trade24Fx
2
Making money, another quiet weekAnother quiet week in the foreign exchange market is over. Traders and investors are getting used to calmness. Although each in such conditions behaves differently. Some optimize trading strategies for existing conditions. Others go to emerging markets where volatility is high. Accordingly, the carry trade is back in fashion. You can use temporary imbalances in capital flows for the purpose of speculative earnings. The most obvious trading strategy is buying of developing countries’ currencies with a high-interest rate of the Central Bank in exchange for the currencies of developed countries with a zero or even negative rate so earn on the interest rate differential. Indian rupee and Chinese yuan can be mentioned as the most obvious buying candidates. And you can sell the Japanese yen and the euro. For those who decided to continue to trade the "majors" in the foreign exchange market, we would recommend dramatically increasing the aggressiveness of trading. In the absence of directed movements, even oscillator works as extremely efficient. Another option is to earn money with options. Obviously, the period of ultra-low volatility cannot last forever and sooner or later the markets will “shoot”. In order to make money on it, you can use basic option strategies, for example, buying both put and call options in the hope of a strong move no matter where (options strategy is straddle). Considering the extent to which option premiums have fallen in price, this strategy may well lead to super-profits. Returning to the news background, we note that this week will be pretty calm. Bursts of volatility are possible in yen pairs. The fact is that on Thursday the Bank of Japan will announce its decision on the parameters of monetary policy, and on Friday a whole block of important statistical data from Japan will be published (data on the labor market, inflation, industrial production, and retail sales). As for our trading preferences, we will continue to look for points for selling dollar in the foreign exchange market (with the exception of USDJPY, which we are still buying), buying of gold and oil in the commodity markets, in addition, we will continue to sell the Russian ruble.
Long
by Trade24Fx
Data from China and the US, world trade is at crisis pointThe statistics from China was the main news event of yesterday. It seems that government measures to stimulate the economy have taken effect. Retail sales and industrial production were much higher than analysts' forecasts of 8.7% and 8.5%. As a result, GDP growth was also pleasantly surprised: 6.4% quarterly growth, with market expectations of 6.3%. The progress in the negotiations between the US and China the result is the decline in gold and the Japanese yen and it looked quite logical and reasonable. But we are still not in a hurry to sell gold. At least today. Moreover, the negotiations are rumors, and the facts are that in the fourth quarter of 2018, world trade fell by 1.8% q / q, which was a record value in the last ten years since the global financial crisis. According to The Telegraph, the recent downturn in world trade is similar to the dot-com bubble collapsed in 2001. Over the past almost 20 years, things were worse only in 2007–2008, when the volume of world trade fell by 12.7%. The dollar “received support” from data on the US trade balance. The deficit turned out to be less than experts had expected: - $ 49.4 billion with the forecast - $ 53.4 billion. We were pleased with the markets and data on the trade balance of Canada, which also came out better than expected. So the main beneficiary of the news of yesterday was the Canadian dollar, which strengthened well, although at the end of the day lost most of the gains. Recall that for the Canadian dollar, which is a typical commodity currency, positive news from China, coupled with positive macroeconomic statistics and high oil prices create almost perfect conditions for growth. Yesterday's news background is generally favorable for commodity markets. But oil was not able to take advantage of this and dropped at the end of the day. We consider this as a signal that the market correction has already matured. Accordingly, while asset quotes are at the local top, we decided to roll over from buying to sales. However, if oil resumes its growth (it will be able to consolidate above 64.50). So today we sell oil with stops above 64.50.
by Trade24Fx
Important day for the pound and The New American Energy EraToday, the most interesting things will happen in the Parliament of Great Britain. Recall Parliament took control of Brexit on Monday. Today is the day when the fate of the Brexit strategy can be decided. Moreover, the range of alternatives is more than diverse: from exiting without a deal to canceling Brexit. Accordingly, the “reaction” of the pound might be very different. We have our own opinion on this. we are in a hurry to share with our readers. So, possible options include: a second referendum, a decision to stay in the EU, a decision to leave the EU without a deal, or the cancellation of Brexit. The last option seems to us extremely unlikely, since the Parliamentarians have already voted against it. This is the only option in which the pound is guaranteed to fall. All other options suggest its growth. The most interesting and exciting is the decision to hold a second referendum. Although votes in his support may not be enough. Voting for the cancellation of Brexit is also a rather interesting option, but again, rather dubious. The most likely we see further inhibition of the process in one way or another. An important nuance of today's voting - they are indicative. That is optional for execution by the Government. Theresa May can even ignore them. But on the other hand, there is so little time left that the option that has scored the most votes “in favor” may well be chosen as the base one. We recommend buying a pound. But racing is possible in both directions. For example, parliamentarians vote for a second referendum - in this case the pound will sharply go up, but then Theresa May will “ban” this initiative, and the pound will bounce down dramatically. These slides can be used for earnings. Another quite interesting statement recently was noted by US Energy Secretary Rick Perry, who said that the world is entering a new "American energy era." It's difficult to argue with him. If 3-4 years ago nobody could even think about exporting oil from the USA, today the country exports over 3 million barrels per day, increasing export volumes by almost 100% per year. By 2020, oil export from the United States is expected to reach 5 million barrels per day (an increase of 70% from current volumes). To understand what the figure of 5 million b / d for the oil market means, we note that from all OPEC countries only Saudi Arabia exports large volumes. The US plans over the next 5 years to overtake Russia in terms of exports and become the world's second-largest oil exporter with a volume of over 9 million b / d (after Saudi Arabia). Looking at these statistics, it's difficult not to agree with the US Energy Secretary. So globally and strategically, oil is worth selling. But here and now, in the current term, we recommend buying oil on the intraday basis. Since the current situation in the light of the actions of OPEC + No. 2, the problems of Venezuela are still on the buying “side”.
by Trade24Fx
Brexit, Bank of England and Norwegian kroneThe key event on Thursday was the announcement of the results of the Bank of England meeting. As expected, there were no surprises: the rate left unchanged, as the volume of the quantitative easing program. However, the statement that perhaps a gradual limited tightening of the policy may be needed, can be interpreted as a “hawkish” and this is good for pound. And before that, the British currency ignored the excellent data on retail sales in the UK in February (+ 0.4% m / m + 4.0% y / y, with the forecast -0.4% m / m + 3.3% y / y). The reason for such attitude is clear. This, of course, is about Brexit. Recall yesterday the EU had to give the UK a response regarding the postponement of Brexit. Brussels gave Teresa May a two-week delay. The current situation is: if next week the British Parliament does not approve the deal, then by April 12, Britain should decide whether to seek a much longer delay or British leave the EU without a deal. This could be used to buy the pound cheaper. Meanwhile, The Central Bank of Norway, raised the rate on Thursday. This is the second increase since last September. Against the background of the negative rates of the ECB, such actions of the Central Bank look simply defiant. As a result, the Norwegian krone continues to strengthen in the foreign exchange market. We recommend to pay attention to its medium-term purchases. Considering how aggressively the Bank of Norway is behaving. The current uptrend of the krona is in the process of being formulated Today is going to be kind of busy with macroeconomic statistics data such as: retail sales and inflation in Canada, indices of business activity in the Eurozone and the United States, so it is not going to be boring. Our basic trading positions are unchanged: we are looking for points for selling the dollar in the foreign exchange market. We are buying oil and gold, increasing the short position in ruble, and now we are taking a medium-term long position in the Norwegian krone.
by Trade24Fx
FOMC Results, 1,000 days after Brexit & “bargain of the century”FOMC Meeting Results. Rate left unchanged, as expected. Therefore, all the attention of the markets was focused on comments about the plans regarding the rate, reducing the balance of the Fed, as well as economic forecasts. So, the Fed was able to perplex the markets, saying that there is no increases this year (recall, the only consensus was increasing this year). The motivation for extending the pause until the end of 2019 is a slowdown in economic growth. In addition, The Fed's program to reduce on its balance will end in September. In general, more than "pigeon" position, so dollar will adversely affect. However, we warned about the feasibility of selling the dollar in yesterday's review. In the light of FOMC outcome, our recommendation “sell the dollar” has become more relevant. Brexit, 1,000 days since referendum. 1,000 days ago, British elected to leave the EU. But it does not work out. But they still far from any agreement. Theresa May is today expected to ask the European Union for a short delay Brexit just days before Britain is scheduled to leave the bloc (no more than three months) in order to agree on new terms of the deal on leaving the EU, but it is not that simple. The European Union could grant Britain's request for a short Brexit delay if parliament votes next week (with just 9 days, until the scheduled date of Britain's exit from the EU) A long- term postponement should be given, but not eliminated the possibility that the U.K. leaves the EU without a deal. In addition, the election in the EU is coming, if the UK does not participate in the European election then the EU may well point the UK at the door. That is why the pound was under downward pressure yesterday. Yesterday's data on UK inflation came out within the framework of forecasts, which means that the Bank of England will leave its monetary policy parameters unchanged. The foreign exchange market will follow the news from Brussels. A sharp decline in oil reserves in the United States (almost 10 million barrels), which is traditionally perceived as a bullish signal. So, our recommendation is to look for points for buying oil on the intraday basis which continues to be relevant. We also continue to recommend buying gold on the intraday basis. One of the most successful hedge funds of 2018, Crescat Capital LLC broke out with apocalyptic predictions. In their opinion, the world is on the verge of recession, which means that the best trading tactics will be buying gold and getting out of risky assets. Analysts of Crescat Capital LLC have responded nobly to loud epithets, calling the purchase of gold "bargain of the century."
by Trade24Fx
News background & trading ideas for 19/03/2019News about the stock market and the oil market. We already wrote last week about the problems of Boeing. So far, they continue to get worse. According to the Minister of Transport of Ethiopia, the flight analysis showed a lot of similar details with the disaster in October. Therefore, markets reacted negatively to this news. Despite of a decline in the Boeing quotations, what is happening is fully within the pattern of reaction to negative force majeure: a fall in value of an asset in 1-2 weeks. Recall that the next phase of this pattern is the return of prices to its normal level (before the occurrence of force majeure). This usually takes at 2-3 weeks. So, if you have the patience to stay in the position for about a month, we recommend in real time testing the testing of the force majeure pattern. You can buy Boeing shares from current prices with a gradual averaging during the week (if the shares continue to fall). Goals - closing the gap on the daily chart. As for the reason for the upward price reversal, it has already been voiced - the cause of the problem is solved by changes in the software. The patch is already developed, it remains to implement it. So a reversal can happen at any time. Germany's two biggest banks are in talks about a merger is another important news. As a result, a financial monster may appear. Brexit. This week, Theresa May has postponed the final vote on her Brexit deal. We were quite skeptical about the idea of hers, because the previous votes did not just fail, but failed with a crash. Our skepticism was justified by yesterday's news. Speaker of the House of Commons John Bercow has banned the British Prime Minister to return the version of the agreement on Brexit to re-vote without any changes. That is, Teresa May will have to go to Brussels and ask for a postponement (the trip is scheduled for Thursday). Of course, if she fails her mission, the pound will not be in a great shape. But it is rather a force majeure scenario. The most likely is granting a delay. So, we are still positive about the pound and recommend its buying. The data on the labor market in the UK. Given that the pound has recently been actively responding to the news background, you can try to trade on the news. As an option, prior to the release of data, place stop orders for both buying and selling in the 15-20 points from the ongoing price at that time. The meeting of the OPEC+ monitoring committee in Baku. According to the committee, the level of compliance with the terms of the transaction was about 90%. At the same time in March they plan to exceed 100%. In general, this is a bullish signal, but there is one significant "but." Recall that before the expiration of the OPEC + No. 2 transaction there is not much time left. So far, there is no unity and clarity on the issue of contract renewal. So, you need to follow the news about the extension of the contract. Otherwise, “bears” may well seize the initiative in the oil market. But until that happens, we continue to recommend buying oil on the intraday basis. We buy gold, sell the dollar, the Russian ruble and the Japanese yen.
Long
by Trade24Fx
News background & trading ideas for 18/03/2019The previous week was marked by Brexit. There were a lot of events, but ultimately with no result. On Tuesday, Teresa May once again was defeated in Parliament - her plan to quit was rejected again. On Wednesday, albeit with a small margin, the Parliament voted against leaving the EU with no deal. And on Thursday they voted for a delay. In theory, the EU must agree to a postponement and the next round of negotiations should start. This is an approximate state of affairs today. However, if the Government succeeds in reaching an agreement with opponents from the Parliament, perhaps on this week will be another vote on the deal. This week is interesting because of the announcement of the results of the Fed meeting on Wednesday and the Bank of England. Moreover, on this week will be released important UK macroeconomic statistics: on Tuesday will be published data on the labor market, and on Wednesday - on consumer inflation, on Thursday - on retail sales. Recall our plan to work with GBPUSD: we buy on the descents. On Friday the oil market passed under the sign of fixing profits. But the fundamental background is still on the buying side. The latest data from Baker Hughes showed that the number of active oil installations in the United States has been at a minimum since April 2018. Russia, meanwhile, reported on partial fulfillment of its obligations under OPEC +, stating that, compared to October 2018, Russia reduced production by 140K b / d, but promised to reach the target amount (recall this month) 228K. Somehow surprised the Russian ruble, which sharply strengthened on Friday. We consider this phenomenon to be short-term and the result of the simultaneous operation of a number of fundamental triggers, ranging from high oil prices to the successful placement by the Ministry of Finance OFZ. The next portion of US sanctions, announced on Friday (the US Treasury added six individuals and eight companies from the Russian Federation to the sanctions list) was simply ridiculous against the market expectations. So, do not relax. We recommend using Friday ruble appreciation as an opportunity to sell it. Although, given the current situation in the market, its further local strengthening is quite likely. But so far all this does not affect on our basic recommendation on long-term sales of the ruble. As for our other positions, we continue selling the dollar across the entire spectrum of the foreign exchange market, with exception of the Japanese yen, which we are continuing to sell against the dollar. We are buying oil in the commodity market, we continue to look for points for buying gold on the intraday basis.
Long
by Trade24Fx
News background & trading ideas for 15/03/2019Britain’s Parliament voted Thursday to seek a delay of the country’s departure from the European Union. As we expected the parliament voted “for” by a margin. The EU will support the delay Brexit until 30 July after voting on 14th of March if the UK asks for. That means that The UK will torment traders with news from the negotiation process, new parliamentary votes, etc. Our position on the pound does not change: we believe in the final successful outcome of the negotiations. That, however, does not cancel pound fluctuations both up and down. Reason for oil growth: OPEC published the February report on the oil market. The most interesting thing in it - OPEC oil production in February decreased by 221 thousand b / d to 30.55 million b / d. Thus, the Cartel fulfills its part of the agreement on limiting production of December 7, 2018 by 105%. At the same time, a phrase appeared in the report, unambiguously showing a desire to extend the effect of OPEC + until the end of 2019 (currently, the agreement expires in June 2019). So, we recommend to buy oil on the intraday basis. Russia is not having a great week. After the resolution of the European Parliament, negative for the Russian Federation, the Counter-Terrorism and Financial Intelligence Directorate of the US Treasury created a division that will deal exclusively with Russia. It is not about “an instant impact”, but about confirming our basic idea. Recall that we have been staunch “bears” on the Russian ruble for some time. About recent economic events, we note weak new home sales data in the USA, which in January fell by 6.9% (analysts had expected growth of 0.2%). Despite dollar growth in the foreign exchange market yesterday, we believe that such data is a reason for selling the US dollar. Today, the Bank of Japan has left the monetary policy parameters unchanged. Analysts did not expect any sudden movements from the Central Bank. Our position on the yen has not changed - we are looking for points for its sales including against the dollar. Moreover, the Central Bank lowered forecasts for economic activity in the country. I relation to macroeconomic statistics the following day is interesting because of the inflation data for the Eurozone, as well as industrial production in the United States. View an index of the results of the University of Michigan is worth it. Our positions and trading ideas on Friday are as follows: we are looking for points for selling the dollar in the foreign exchange market against such currencies as: euro, pound and Canadian dollar with the exception of the Japanese yen - we buy USDJPY. We also buy oil and gold on the intraday basis.
Long
by Trade24Fx
News background & trading ideas for 12/03/2019 Traders were discussing about the fall of Boeing yesterday. And it was about the tragedy in Ethiopia and about the sharp decline in the value of the company's shares (the company has lost 10% at the auction before the market opened). Despite some panic in the ranks of investors and users of Boeing aircraft (China even has temporarily banned using of Boeing 737 Max models), we believe that, it offered an opportunity to earn. We are talking about buying shares of Boeing. The panic settles, the flights will be resolved and the stock will be returned to its original state. A 10% profit in a short period of time is fair enough. Therefore, we recommend our readers to pay attention to an interesting trading opportunity. The dollar continues to lose out in the foreign exchange market. Friday`s disastrous data wasn`t pointed enough for the Fed Chairman, and he stated in an interview with the CBS News that there is no clear timelines for the Fed`s current pause. This can be perceived in essence as a refusal to further increase rates by the Central Bank (at a certain level of fantasy, of course). The interview, in our opinion, is not in favour of the United States dollar. Although we note that yesterday`s data on US retail sales (0.2% m/m with a forecast of 0% m/m) slightly improved the mood of dollar buyers. But they were not so good that we changed our point of view. So, we continue to recommend looking for points for its sales in the foreign exchange marker. First of all, we recommend doing it against the British pound, which rose quite well yesterday. However, today the fate of the pound in the hands of the Parliament of Great Britain. In the evening, another vote should be held on the text of the treaty between the EU and the UK. Apparently, the current edition of the treaty does not carry revolutionary innovations. And this means that the probability of failure is quite high. We see the following plan of action: if they vote “for”, we buy a pound with targets of at least 300-500 points. If they vote “against”, the pound certainly will be sold out. And we do not recommend to participate in sales, because it seems to us a very risky occupation. On the contrary, we advise you to wait until the end of the active sales phase, and when prices begin to consolidate, buy a pound. The result of Brexit, after all, is important for the pound not the outcome of the vote. The only really scary option for the pound - “exit with no-deal” which is now extremely unlikely. So, that does not threaten the pound much. Today we should pay attention to the data on consumer inflation in the US. Weak data could enter into resonance with Powell's interview and trigger dollar sales on the foreign exchange market. As for our other positions: we continue to buy oil on the intraday basis. A power outage in Venezuela seems to be able to finish off the economy and the oil sector there. And this means that a large volume of supply is decreasing in the oil market. It is a bullish signal. We sell the Russian ruble on the intraday basis.
FX:NGAS
by Trade24Fx
News background & trading ideas for 11/03/2019 Last week was not a calm one. The ECB has surprised everyone with news about the euro. The ECB sharply lowered forecasts for economic growth in the Eurozone and announced the launch of the third long-term lending program. But the data on the US NFP was the main surprise. With forecasting employment the outlook outside the agricultural sector was in the amount of + 180K (February), but the fact is that another figures appeared, it is + 20K. We warned about something similar in Friday’s review and recommended to sell the dollar in advance. The data on rates of unemployment and the average hourly wage was a bit softened the blow, which came out better than expected. But overall, with such data on the NFP, our position on the dollar has only strengthened, and this week we continue to recommend its sales. One of the good candidates for this is USDCAD. The fact is that Friday's data on employment in Canada was very pleasantly surprised. Therefore, we have a double reason for selling USDCAD. Sum up, we are looking for points for selling USDCAD on the intraday basis. As for the current week, the main event is the next vote in the Parliament of Great Britain on the date in UK's divorce from EU. Last week, the pound was under strong downward pressure due to the lack of progress in negotiations between the EU and the UK. Accordingly, traders fear the next failure of Theresa May in Parliament. Two weeks prior to the date of the official release the date of the divorce from the EU. Our position is unchanged - we are looking for points for buying pound, because we are sure that there will not be divorce with no deal. However, it does not negate the very likely decline of the pound today and tomorrow. The negotiations between the USA and China continue to be in focus. The results of the Bank of Japan meeting will be observed with interest, which will be announced on Friday. What about the macroeconomic statistics we note that the most interesting is the data on retail sales and consumer inflation in the United States. There is no change in the oil market. The official oil reserves in the United States increased last week, but the number of active drilling rigs, on the contrary, decreased quite sharply (by 11 units). These are bullish signals. So, we continue to recommend to look for points for buying it on the intraday basis. Do not forget to sell the Russian ruble. After the crushing data on the NFP, considering the fact that the asset is above the 1295, today we are buying the gold with small stops.
Long
by Trade24Fx
News background & trading ideas for 05/03/2019 Today we are forced to return to the discussion of already quite tedious topics just because no significant new macroeconomic statistics was released yesterday. It is impossible not to discuss them. Topic A - negotiations between the USA and China. We should recall that burying the hatchet war could lend a positive momentum to the global economy. The greatest fear of the financial worlds is economic slowdown.It is worth noting news from China and reduction in the tax burden. Another positive news item for the economy of China and for the global economy is that China recently lowered (from 6.5% to 6%) its forecasts for the country's economic growth in 2019. So, the news on the negotiation process between the United States and China is encouraging. According to the Wall Street Journal, the signing of the agreement between the countries may take place on March 27. A sharp decline in gold prices was triggered by progress in the negotiation process and its approach to the final stage. Considering the fact that the support of the 1295 did not keep balance yesterday. We abandon the idea of buying gold on the intraday basis. Our basic concept did not change at all - movement above the 1295 - look for points for buying, and movement below - for sales. So, today we are going to look for points for gold sales with the stops above the 1295. The situation is kind of similar in the oil market. But the key support is still in the game, so we continue to look for points for buying assets on the intraday basis. There are no contraindications for it. The resolution of the trade dispute between the United States and China is a positive sign for oil demand. At the same time, OPEC continues to maintain discipline and puts a lid on oil production. That is different from Russia. The Russian Federation continues to produce more than it was due to the agreement between Russia and OPEC + (according to the latest data, Russia produces 11.336 million barrels per day, but should be limited its production to 11.182 million b/d). There is no changes with the dollar. Our recommendations did not change also- we are looking for points for selling US dollar on the intraday basis, especially against the Canadian dollar. The exception is the USDJPY where we are buying the dollar. We note that another Trump’s verbal attack on the Fed’s monetary policy is a background for our basic recommendation for selling the dollar. Remind you that Trump stands for the rate hikes. And although Trump's words are twofold. But do not underestimate him. How not to forget about the development of the political scandal around the figure of Trump. Nobody speaks about impeachment, but Muller’s testimony may lead this news on top, again.
BITFINEX:XRPUSD
by Trade24Fx
News background & trading ideas for 04/03/2019The ending of last week took us by surprise. Mainly it is about clearance sales of gold. Not about that something unbelievable happened: from a technical point of view, gold sank to basic support and tried to take it by storm – so, it is a quite common thing. He case is that, there are no significant reasons for this. The ISM index of business activity in the US manufacturing industry sank to its lowest level in the last two years, therefore, it is not a reason for selling gold. We have repeatedly noted that in our understanding the 1295 +/- mark is a kind of separating of forces in the gold market. So, while we don’t have any confidence in reaching this level, we believe that the points for buying are just perfect: with minimum stops, you can count on maximum profit. Getting back to Brexit crunch meeting dissociation over the last week, we would like to note that Brexit failed again. It is about delaying the votes on Plan B. Theresa May was given time to its finalization. As a result, the pound was in perfect shape, by the end of the week. People realized that the U.K. will not leave the European Union with no deal. It was a positive sign for the British currency. As for the decline on Friday, it was more likely profit taking than breaking down of background. Fed Chairman Powell has been acting in Congress for a week. However, we didn’t get any new information from him. It finally became clear that raising the rates in doubt. So, monetary policy is paused until clarification. The previous week was relatively calm in terms of macroeconomic statistics. But the current one promises to be over-saturated. Read out run-down of the latest events: the announcement of the decision of the Reserve Bank of Australia (Tuesday), the Bank of Canada (Wednesday), the ECB (Thursday), and data on the US labor market will be completed on Friday. And this is not counting all sorts of macroeconomic statistics (on the labor market of Canada, GDP in the Eurozone and Australia, business activity in the USA, etc.). So, it will not be boring. We will closely follow foreign affairs and keep up to date. Our preferences in trading, they might change this week. We are still buying gold, but movement below the 1290 will be a sign for us that it’s time to change trading technique. We continue to buy oil and the pound on the intraday basis. Despite the extremely weak data on Canada's GDP, published on Friday, but today we are trying to sell USDCAD . As usual, we sell the Russian ruble in the intraday, medium and long-term directions. In general, we tend to sell the dollar in the foreign exchange market. Except USDJPY , which we will buy on descents within the day.
FOREXCOM:XAUUSD
by Trade24Fx
News background & trading ideas for 28/02/2019The conflict between India and Pakistan has attracted surprisingly little interest in financial markets. But by that time there are downed aircraft and the open-armed clashes at the border. Recall, both States have nuclear weapons and have as well 1.5 billions of population for two. Yes, clashes in Kashmir are actually common, but this time everything can end truly bad. In this regard, we continue to remind about the feasibility of buying safe-haven assets. Such as gold in commodity markets and the Japanese yen in the foreign exchange market. Yesterday was second statement day by Jerome Powell in Congress. However, we didn’t hear anything really new. Unless the Fed Chairman has added about the Tuesday’s announcement of the plan to suspend the reduction of the balance of the Central Bank. The British Parliament, meanwhile, approved the amendment, which has confirmed in writing May’s authority over the possible postponement of Brexit’s terms. The pound continued a confident growth about this, which we are observing throughout the ongoing week. Despite the fact that it reached 1.33 marks in pair with the dollar, and the set doing great in terms of growth. So we continue to recommend pound’s purchases. Once again we pay our readers attention to the feasibility of sales of the Russian ruble. The points are attractive for entry, and what is even more important, the fundamental background is appropriate for that. The USA released the text of the new sanctions bill. We are talking about the so-called "deadly" sanctions, which involve restrictive measures to participate in investment projects for oil and gas production (LNG), as well as the development of relevant fields. But restrictive measures are more than that. It has been also proposed to extend sanctions to new issues of OFZs and limiting the possibility of owning other debt securities of the Russian Federation and its subsidiaries to 14 days. The aim is to excommunicate Russia off all financial resources. It did not take long to see the results - recent investors are in a hurry getting rid of Russian Euro bonds because they are scared that soon they will not be able simply to sell it to anyone. Sberbank experts estimate that since last April, non-resident investments in Euro bonds have decreased by almost $600 million. In the oil market, the situation has somewhat stabilized, and the movement has returned to the current base course - to the prices’ increase. This was partly due to a significant reduction in oil reserves in the United States, and to a greater extent to verbal interventions by Saudi Arabia that OPEC+ members will continue to cut their production. Also, news about the progress in negotiations between the US and China improve the fundamental background. Our intraday recommendation remains unchanged - we are looking for points for oil purchases. Talking about today, we note that in terms of macroeconomic statistics the attention should be paid on GDP data in the US. Our following tradings positions for today are: looking for points for dollar’s intraday sales in the foreign exchange market, buying oil within the day on the way down, buying safe-haven assets (gold and Japanese yen); selling the Russian ruble and buying the British pound.
Long
by Trade24Fx
News background & trading ideas for 27/02/2019The breaking news keeps on coming from the Brexit fronts. Yesterday we wrote that the vote over Plan B on the twenty-seventh of February could not happen. But the delay of the vote was not enough for Theresa May, and there’s already talk of rescheduling of Brexit terms. Which is that she had repeatedly denied. Simultaneously, there were information flows from the EU that this could be not weeks or months, but even years (!). So, is beginning to give the impression that the Brexit is slowly being railroaded. Brexit fatigue has reached a critical mass, and such a solution could serve on the quite fertile ground. What does this mean for the pound? The answer is given by yesterday’s dynamics. This is good news for pound buyers surely. Since, recall, at the time of the referendum, the pound hovered at around 1.50. Thus, our position has once again found a confirmation, and we continue to recommend pound’s purchases since its growth potential is far from being exhausted. But the situation continues to be volatile. So we are keeping an eye on things. It is restless and bad in the rest of the world. First of all, it’s about the tension between the already long-standing hostile neighbors - India and Pakistan (India launched an air strike on the Pakistan territory). Since both countries possess nuclear weapons, and the conflict is quite deep, the development of the situation may become worldwide. Which, of course, does not contribute to reassure investors in financial markets. In this regard, we recall our recommendations for gold purchases . The significant event of yesterday was the speech of Fed Chairman Jerome Powell to the Senate Banking Committee. The key message of Powell’s speech is that now is a good time to stand still on the monetary policy. It would be weird if he said something else. We perceive his comments as neutral, and remain our dollar’s position unchanged, besides recommending its sales in the foreign exchange market. As for macroeconomic statistics, important data did not come out yesterday. Today is much more interesting in this regard. First of all, we are following data on orders for durable goods in the US and inflation data from Canada, as well as monitoring the second round of Jerome Powell's speech. We have placed a major emphasis on news from Great Britain. There may well be bursts of pound’s volatility today, so it would be ridiculous passing through the opportunity to make a profit. Our trading positions are unchanged: looking for points for dollar’s intraday sales in the forex market; buying oil and gold within the day on the way down, selling the Russian ruble; buying the pound.
Long
by Trade24Fx